Home Office

Provisional Police Grant Report (England and Wales) 2023-24

Lord Sharpe of Epsom: My rt hon Friend the Minister of State for Crime, Policing and Fire (Chris Philp) has today made the following Written Ministerial Statement:My Rt Hon. Friend the Home Secretary has today published the Provisional Police Grant Report (England and Wales) 2023-24. The Report sets out the Home Secretary’s determination for 2023-24 of the aggregate amount of grants that she proposes to pay under section 46(2) of the Police Act 1996. A copy of the Report will be placed in the Libraries of both Houses. Today the Government is setting out the provisional police funding settlement in Parliament for the 2023-24 financial year. Overall funding for policing will rise by up to £287 million compared to the 2022-23 funding settlement, bringing the total up to £17.2 billion for the policing system. Within this, funding to Police and Crime Commissioners (PCCs) will increase by up to an additional £523 million, assuming full take-up of precept flexibility. This would represent an increase to PCC funding in cash terms of 3.6% on top of the 2022-23 police funding settlement. The Chancellor confirmed at the Autumn Statement that departmental budgets set out at Spending Review 2021 will be maintained to 2024-25. This confirms that, despite the pressures faced by all public services, we are still increasing funding into 2023-24 by providing forces with an increase to government grants of £174 million, £74 million more than announced at Spending Review 2021 (SR21), reflecting the commitments made earlier this year to support the 2022-23 pay award. By delivering on this promise, we are making sure that the police receive the funding they need to achieve and maintain their overall officer headcount, comprised of their agreed Police Uplift baseline plus their allocation of the 20,000 additional officers. To ensure that policing are able to balance budgets and deliver on key priorities, we have gone even further by providing an additional £5 on top of the £10 precept limit agreed at SR21, which could raise up to an additional £349m when compared to 2022-23. This means that PCCs will be receiving up to £15.1 billion of funding in 2023-24, an increase of over half a billion pounds. This Government has provided significant investment into policing over the previous four years, and so now it is only right that we hold forces to account on delivery. We therefore expect policing to approach the 2023-24 financial year with a focus on this Government’s key priorities: Ensuring overall police officer numbers are maintained at the agreed Police Uplift baseline plus force level allocations of the 20,000 additional officers.Deploying these additional officers to reduce crime and honour this Government’s commitment to keep the public safe.Delivering improvements in productivity and driving forward efficiencies, maximising the value of the Government’s investment. Police Uplift Programme  Since 2019, this Government has invested over £3 billion, including additional funding each year and that rolled into government grants, to enable the recruitment of 20,000 additional officers, a government priority and manifesto commitment. Forces have worked hard and are delivering at pace, having recruited 15,343 additional officers in England and Wales as of the end of September 2022. It is critical, however, that beyond March 2023 officer numbers are maintained to ensure the benefits of the additional 20,000 officers can be realised. Forces will need to retain both new and more experienced officers as we move into a new phase of the maintenance of officer numbers in 2023-24. We will look to forces to invest in their officers, striving to be efficient and conscientious with their own budgets. Many officers recruited since 2019 will be reaching the end of their probationary period, and we expect forces to deploy new and experienced officers effectively to ensure local communities benefit from the investment now and in years to come. Reflecting the importance of reaching this milestone and maintaining the additional officers, in 2023-24 £275 million will be ringfenced and allocated in line with funding formula shares. As in previous years, PCCs will be able to access this by demonstrating that they have maintained their overall officer headcount, comprised of their agreed Police Uplift baseline plus their allocation of the 20,000 additional officers. Precept Spending Review 2021 confirmed that PCCs in England will be empowered to raise additional funding through increased precept flexibility of up to £10 per year to 2024-25. However, recognising the financial pressures police forces are facing, we propose to enable PCCs in England in 2023-24 to increase their precept by up to £15 for a typical Band D property, subject to a period of consultation and approval from the House of Commons through the Local Government Finance Settlement. This would equate to an additional £349 million should all PCCs maximise this flexibility.[1] Using this precept flexibility is a decision that must be taken by each locally elected PCC. Local taxation should not be in place of sound financial management, and therefore I expect PCCs to exhaust all other options to reprioritise their budgets, seek efficiencies and maximise productivity of their existing resources before looking to local taxpayers for additional funding. Efficiency and productivity Police, like all public services, must ensure that they make best use of public money. This means reducing inefficiencies and maximising productivity. As part of the Spending Review 2021, we expect to see at least £100 million of cashable efficiency savings delivered from force budgets by 2024-25, achieved through areas such as:Working with BlueLight Commercial to maximise financial and commercial benefits related to procurement, through use of the organisation’s commercial expertise, leveraging the purchasing power available across the sector, and developing the capacity to implement a full commercial life-cycle approach to procurement.Corporate Functions, where the Home Office and BlueLight Commercial are conducting ongoing work with the sector to understand the opportunities around the management of corporate functions for example implementation of shared service models.BlueLight Commercial is itself a sector-owned company, set up to provide commercial expertise and assistance to policing and assist forces in identifying and making efficiency savings. In 2021-22 the company assisted policing in make efficiency savings of almost £40 million (including cashable savings of £25m and non-cashable savings of £15m). The organisation has been funded by the Home Office for the last three years and we will continue to support the company in 2023-24 whilst they work towards establishing and implementing a sustainable funding model. For the continuing significant investment into policing that the government has made in recent years it is crucial that we are delivering the best possible value for the public. This includes ensuring that the police are meeting the needs of their community and the public are receiving the highest possible quality of service. We have therefore commissioned the National Police Chiefs’ Council to conduct a review of operational productivity in policing. We expect the review, led by Sir Stephen House, to deliver clear, practical, and deliverable recommendations to improve the productivity of policing, with the review team having already considered how the police respond to individuals experiencing acute mental health distress. National priorities This settlement provides £1.1 billion for national policing priorities (as set out at tables 1 and 4) to support PCCs and forces, and to support the strategic vision outlined in the Beating Crime Plan to cut crime, increase confidence in the criminal justice system, and put victims first. For 2023-24, we will maintain settlement funding for programmes that prevent crime and help keep communities safe, including:This settlement provides funding to combat serious violence, including Violence Reduction Units and the Grip ‘hotspot policing’ programme. Funding arrangements for specific crime reduction programmes will be confirmed in due course.Delivering on the commitments made in the 10-year drug strategy by prioritising funding to clamp down on drugs and County Lines activity which has already achieved over 2,900 county line closures since 2019.Continuing to invest in tackling exploitation and abuse, including child sexual exploitation and modern slavery.Prioritising Regional Organised Crime Units, ensuring they are equipped with the specialist capabilities and dedicated resource needed to support law enforcement in confronting serious and organised crime. Funding arrangements for specific crime reduction programmes will be confirmed in due course. Going further, this settlement provides funding to improve the criminal justice system, victim care, and investigation outcomes including:Prioritising funding for commitments made through the Rape Review, ensuring the right support is in place to support police forces in implementing the national operating model for rape investigations and improving their digital capability, crucial for improving timeliness and reducing victim attrition.Investing in a new Victim Satisfaction Survey to drive improvements in the support police forces provide to victims, and gain new insights into why victims withhold or withdraw support for investigations.Continuing to invest in the development of forensics tools and services for police forces, and the Forensic Capability Network as a central resource supporting the national network of over 4,000 forensic specialists in police forces. It is crucial that police forces and law enforcement partners have effective technology systems to support front line officers. Therefore, we are:Providing funding for major programmes of work which are already underway to replace and improve systems, such the National Law Enforcement Data Programme and Emergency Services Mobile Communications Programme.Continuing to invest in critical national police and law enforcement IT capabilities to transform the way that the police engage with the public and unlock more efficient working practices. Counter-terrorism policing  The Government will continue to provide vital support for counter-terrorism (CT) policing, ensuring they have the resources they need to meet and deal with the threats we face. CT police funding will continue to total over £1 billion in 2023-24. This investment will support ongoing CT policing investigations to keep the country safe and includes funding for both armed policing and the CT Operations Centre. PCCs will be notified separately of force-level funding allocations for CT policing, which will not be made public for security reasons This settlement will support the police to do their vital job to cut crime and keep people safe. I would like to express my gratitude and pay tribute to our dedicated police officers and staff for their exceptional commitment and bravery. I have set out in a separate document, attached, the tables illustrating how we propose to allocate the police funding settlement between the different funding streams and between Police and Crime Commissioners for 2023-24. These documents are intended to be read together. [1] Calculated using the latest forecasts. Council tax in Wales is devolved and PCCs in Wales are not bound by the council tax referendum principles.Tables (pdf, 403.9KB)

Department for Levelling Up, Housing and Communities

Homes for Ukraine Scheme: Update

Baroness Scott of Bybrook: My Right Honourable friend the Secretary of State for Levelling Up, Housing and Communities and Minister for Intergovernmental Relations (The Rt Hon. Michael Gove MP) has made the following Written Ministerial Statement:Today I announce measures to update the Homes for Ukraine Scheme. This scheme has been a significant success. Although the initial rollout of visas was slower than the Government would have liked, over 100,000 Ukrainian guests are now safe in the United Kingdom. 37,500 more have valid visas and may choose to travel to the United Kingdom if circumstances change. The sheer number of applicants and of British families willing to open their homes to those seeking shelter is truly extraordinary.The Government is committed to protecting this route to safety into its second year, but we need to do so in a way that is sustainable considering the wider pressures on public finances and the UK’s overseas development assistance budgets. We are therefore setting out today a series of updates. These measures taken together are designed to recognise the contribution made by sponsors while also ensuring the sustainability of the programme over the longer term and to provide certainty to all those who are supporting our guests here in the UK.‘Thank you’ paymentsHosting is a very significant commitment. The Government is enormously grateful to all those who have volunteered to share their home with Ukrainian people fleeing war. Without the generosity of all our British sponsors, we simply would not have been able to give shelter to so many of those in need. In recognition of this, I am announcing today that the £350 ‘thank you’ payments, will be extended from 12 months to a maximum duration of two years. The UK Government will also increase the minimum ‘thank you’ payments for hosts from £350 per month to £500 per month, once a guest has been here in the UK for 12 months.This additional financial support is aimed at helping existing hosts to continue with their sponsorship, as well as new hosts who come forward to offer a home to a Ukrainian individual or family.Some local authorities are already uprating ‘thank you’ payments using their own resource, and this is a measure we fully support. Our new package shows our strong desire to recognise the contribution made by sponsors, to help them with the rising cost of living and incentivise further sponsorships and rematching.Funding for Local AuthoritiesSince the Homes for Ukraine scheme launched in March 2022, the UK Government has provided £1.1 billion to councils through a tariff for each arrival in their area. This funding is available for councils to support Ukrainian guests and their sponsors. Given a fraction of Ukrainian arrivals return to Ukraine, after arriving in the UK, and the need to manage public finances at a time of significant economic challenge for the UK and the global economy, the Government will reduce the tariff for each local authority. Councils will continue to receive the existing year 1 tariff to support those Ukrainians that have already arrived, as previously set out. From 1 January 2023, councils will receive funding of £5,900 for each new arrival to support guests and their sponsors (in addition to the ‘thank you’ paid to sponsors). Local authorities will continue to receive separate funding in 2022-23 for the Ukraine education tariff under the rates and terms previously set out (a per child tariff of £3,000 for early years, £6,580 for primary and £8,755 for secondary and payments calculated on a pro-rata basis); and the Ukrainians families will also continue to receive government support on skills training, job centre access and welfare payments. The Department fully recognises the many pressures on local authority budgets and at the Autumn Statement the Government announced a further £6.5 billion to be made available for local government to deliver core services over the next two years.The Department will also provide £150 million of new UK-wide funding in the 2023/24 financial year to local authorities and devolved governments to help support Ukrainian guests move into their own homes and reduce the risk of homelessness. Local authorities are best placed to understand the support needed for local communities and as is typically the case for various local authority funding, they will also be able to use this funding to support other people at risk of homelessness. This funding will be allocated between the different parts of the UK in relation to their proportion of Ukrainian guests. I will be writing to local authorities and my counterparts in the devolved administrations with more details on this shortly.Local Authority Housing FundToday, I am also launching a £500 million Local Authority Housing Fund, which will provide capital funding directly to English councils in areas that are facing the most significant housing pressures as a result of recent Ukrainian arrivals. These local authorities are facing housing challenges on the back of their generosity, which unless alleviated will further impact existing housing pressures. This fund will allow them to address the immediate pressures as well as build a sustainable stock of affordable housing for the future. This fund will also be used to provide homes for up to 500 Afghan families currently living in bridging hotels at a significant cost to taxpayers. Whilst helping to fulfil the UK’s humanitarian duties to assist those fleeing war, the fund will create a lasting legacy for UK nationals by providing a new supply of accommodation for councils with which to address local housing and homelessness pressures.The UK Government continues to work with the Ukrainian government, the devolved governments, local authorities and charities and voluntary groups to deliver the Homes for Ukraine scheme and support sponsors and their guests.

Foreign, Commonwealth and Development Office

China

Lord Ahmad of Wimbledon: My Rt Hon Friend, the Secretary of State for Foreign, Commonwealth and Development Affairs, has made the following statement:In October, I summoned China’s Acting Ambassador to the Foreign, Commonwealth and Development Office to demand an explanation for an incident that had occurred outside the Chinese Consulate General in Manchester. Soon afterwards, His Majesty’s Ambassador in Beijing also sought an explanation from the Chinese Ministry of Foreign Affairs.Images carried on social media showed what appeared to be completely unacceptable behaviour by a number of individuals near the entrance to the consular premises. The right of free expression - including the right to protest and to speak one’s mind - is absolutely essential to our democratic life.Given the seriousness of this matter, it was correct and appropriate for Greater Manchester Police to take the decision to begin an investigation. Earlier this month, the Police informed the FCDO that they wished to interview the Chinese Consul General and five of his staff. They asked the FCDO to request the Chinese Government to waive the immunity of those individuals to enable the interviews to take place.The FCDO made this request and gave the Chinese Government one week to comply. In response, the Chinese Embassy, acting on instructions from Beijing, notified His Majesty’s Government that the functions of the Consul General in Manchester have come to an end and he has returned to China. The Embassy has further notified us that the other staff involved in the incident who the Police wish to interview have either left the United Kingdom or will shortly do so. Throughout this episode, I have sought to emphasise that we in the UK abide by the rule of law, follow due process and respect the operational independence of our police.  It was right to allow their investigation to proceed so that we could respond on the basis of evidence and facts, rather than images on social media. I am grateful for the professionalism shown by the Greater Manchester Police, particularly given the complexities involved due to the immunities held by the staff. We have been clear with China from the outset that we were prepared to take firm action should the police determine that there was a case to charge officials for their involvement in the incident. We expect a certain standard of behaviour from all foreign diplomats and consular staff in the UK regardless of their privileges and immunities. The Vienna Convention on Consular Relations allows States to withdraw members of a consular post at any point, as has happened here. However, I am disappointed that these individuals will not be interviewed or face justice. Nonetheless, it is right that those responsible for the disgraceful scenes in Manchester are no longer – or will shortly cease to be - consular staff accredited to the UK.

Department of Health and Social Care

Correction to HL2636

Lord Markham: I would like to amend a written answer that I gave to the House on the 7 November 2022.An incorrect figure was provided in my reply to HL2636, which was asked by The Lord Bishop of Gloucester. The question was: “To ask His Majesty's Government how many recipients of Healthy Start vouchers are not in receipt of prepaid cards despite remaining eligible for the scheme.”The reply stated that “The NHS Business Services Authority estimates that as of 18 October 2022, there were 2,954 households previously were in receipt of paper vouchers which have not successfully applied to the NHS Healthy Start prepaid card scheme. “However, it has since been brought to my attention that the figures supplied by the NHS Business Services Authority (NHSBSA) had a typographical error. The answer should have stated that “the NHS Business Services Authority estimates that, as of 18 October 2022, there were 42,954 households which previously were in receipt of paper vouchers which have not successfully applied to the NHS Healthy Start prepaid card scheme.” I apologise that the incorrect figures were inadvertently supplied.Further to the revised answer, I am also able to share a more recent estimate. As of 27 November 2022, the NHSBSA estimates that there are now 35,284 households which previously were in receipt of paper vouchers which have not successfully applied to the NHS Healthy Start prepaid card scheme. I would like to clarify that some of these households will not have reapplied to the prepaid card scheme because they no longer meet the eligibility criteria for the scheme. This could be because their child has reached the age of four or because their household income has changed.I would also like to provide some context about the scheme’s digitisation, and the transition from paper vouchers to prepaid cards. The latest available data shows that uptake of the scheme by the eligible population increased overall, from 55% in March 2021, to 72% in March 2022. Since the paper voucher scheme closed at the end of March 2022, the number of households on the Healthy Start scheme has continued to increase, from 273,280 on the 31 March, to 323,136 on the 27 November.I would also like to share details of the activity that the NHSBSA has undertaken to support households which were in receipt of paper vouchers to apply for the digitised prepaid card scheme. Since September 2021, the NHSBSA sent multiple communications to all paper voucher beneficiaries to encourage them to apply for the prepaid card scheme. This includes a total of four invitation letters to their home or email address, two leaflets in voucher packs and text messages to those who had mobile numbers on their accounts. There was also targeted social media activity to encourage people to apply to the prepaid card scheme. Stakeholders and local organisations also supported the transition by raising awareness with beneficiaries. Additionally, the NHSBSA actively promotes the scheme through their digital channels and have created free tools to help stakeholders promote the scheme at a local level.I have also asked the NHSBSA to update me on their future plans to promote uptake of the Healthy Start scheme among all eligible groups.

Genome UK: England Implementation Plan

Lord Markham: My Hon friend the Minister of State (Minister for Health and Secondary Care)(Will Quince) has made the following Written Statement:This is a joint statement with the Secretary of State for Business, Energy and Industrial Strategy.In 2020, the government published Genome UK, the UK’s genomic healthcare strategy, setting out a vision to create the most advanced genomic healthcare system in the world, underpinned by the latest scientific advances, to deliver better health outcomes at lower costs. The strategy made 45 commitments to be delivered over 10 years to achieve this vision. Delivering this vision will help people to live longer healthier lives, reduce the burden of illness on the NHS and make the UK a world-leader in data-driven healthcare research and innovation.I am delighted to inform the House that we are today publishing the “Genome UK – England Implementation Plan 2022 to 2025”, which sets out how we will further progress delivery of Genome UK in England during the current spending review period, taking us to the halfway mark of our ambitious 10-year strategy. In order to allow us to reflect advances in this fast-moving field, we have adopted a phased approach to implementing the strategy, with implementation plans published in line with spending review periods.This publication follows the previous “Genome UK: 2021 to 2022 Implementation Plan” in May 2021, and “Genome UK: shared commitments for UK-wide implementation 2022 to 2025” in March 2022. Through extensive collaboration with partners across the genomics community we have set out our priority actions, showcasing the outstanding research and policy work that will take place across England to develop, evaluate and implement new genomic technologies across the health and care system and life sciences sector. As part of this, I am pleased to announce:£105 million of government funding for a landmark research programme, led by Genomics England in partnership with the NHS, to study the effectiveness of using whole genome sequencing to speed up diagnosis and treatment of rare genetic diseases in newborn babies, potentially leading to life-saving interventions for thousands of babies.£22 million of government funding for Genomics England to tackle health inequalities in genomic medicine through tailored sequencing of 15,000 - 25,000 participants from diverse backgrounds by 2024/25, as well as extensive community engagement work to build trusting relationships with traditionally excluded groups of people.£26 million of government funding for an innovative cancer programme, led by Genomics England in partnership with NHS England and the National Pathology Imaging Co-operative, to evaluate cutting-edge genomic sequencing technology and use artificial intelligence to analyse genomic data alongside digital histopathology and radiology images to improve the accuracy and speed of diagnosis for cancer patients.up to £25 million Medical Research Council-led funding for a 4-year functional genomics initiative, working across UK Research and Innovation and other stakeholders to establish an industry-partnered world-class offer on functional genomics, building on already existing infrastructure and UK research expertiseThese are just a few of the many actions that are set out in the implementation plan, which also covers how we will engage with patients and the public; develop the genomics workforce; support industrial growth and explore a possible UK model for how to apply ethical standards in genomic healthcare and research.Together, these actions will pave the way to bringing improved approaches to disease prevention, diagnosis, and treatment to people and patients, transforming healthcare and improving the health of the nation. Through these actions we will also increase private sector investment, by ensuring that the UK is the best location globally to conduct genomic research and grow new genomic healthcare companies.Patients and the diverse UK population are at the heart of our journey to the world’s most advanced genomic healthcare system. Equally, this vision cannot be achieved without the support of our talented healthcare workforce. I therefore want to emphasise that open engagement with the public, patients and workforce will continue to be central in the delivery of our 10-year vision.This implementation plan has been agreed with the Genome UK Implementation Coordination Group and the National Genomics Board, which are made up of senior life sciences stakeholders and delivery partners from across the NHS, charity sector, research, and industry. The devolved governments will be publishing their own implementation plans, to ensure that genomic healthcare is able to flourish across the UK. Over the next three years we will continue to work with our partners, including the devolved governments, via the Genome UK Implementation Coordination Group and the National Genomics Board, to ensure that we can continue to create the most advanced genomic healthcare system in the world.

Treasury

Financial Services

Baroness Penn: My right honourable friend the Chancellor of the Exchequer (Jeremy Hunt) has made the following Written Ministerial Statement.In the Autumn Statement, I set out the government's strategy for boosting growth by investing in our people, in the infrastructure that connects our country, by creating the right environment for business investment, and by supporting our world-leading financial services companies and innovators. Alongside this, I identified five growth sectors – one being financial services – for which the government will prioritise the review of retained EU law, to ensure we identify changes that will support these sectors to grow.I am today setting out a bold collection of reforms taking forward the government’s vision for an open, sustainable, and technologically advanced financial services sector that is globally competitive and acts in the interests of communities and citizens. These reforms will create jobs, support businesses, and power growth across all four nations of the UK.The UK is one of the world’s leading financial centres and our financial services sector is one of the engines of the UK’s economy. Financial and related professional services employ over 2.3 million people, two thirds of whom are outside of London, with hubs in Belfast, Birmingham, Cardiff, Edinburgh, Glasgow, Leeds, and Manchester.[1] In 2021, the financial services sector contributed £173.6 billion to the UK economy, 8.3% of total economic output.[2]The announcements being made today build on the reform agenda the government is taking forward through the Financial Services and Markets (FSM) Bill. The government’s approach recognises and protects the foundations on which the UK’s success as a financial services hub is built: agility, consistently high regulatory standards, and openness. This approach will ensure that the sector benefits from dynamic and proportionate regulation, and that consumers and citizens benefit from high quality services, appropriate consumer protection, and a sector that embraces the latest technology.I have set out below details of the measures being taken forward, which I look forward to delivering in close collaboration with our vibrant financial services sector.A competitive marketplace promoting effective use of capitalBuilding a smarter regulatory framework for the UK The government has today published its policy statement Building a smarter financial services framework for the UK. A copy will be deposited in the Library. This is an ambitious plan for repealing retained EU law in financial services and replacing it with a new framework tailored to the UK, embracing the new opportunities presented by our position outside the EU.Our approach includes:Publishing draft Statutory Instruments to demonstrate how the government can use the powers within the FSM Bill to reform the prospectus and securitisation regimes and to ensure the Financial Conduct Authority (FCA) has sufficient rulemaking powers to regulate payments services and e-money. Overhauling the prospectus regime will enable the government to implement recommendations from Lord Hill’s UK Listing Review, helping to widen participation in the ownership of public companies, simplify the capital raising process for companies on UK markets, and make the UK a more attractive destination for Initial Public Offerings. The government is also committed to working with the FCA and Prudential Regulation Authority (PRA) to bring forward relevant reforms identified in HM Treasury's 2021 review of the Securitisation Regulation.Plans to repeal the regulations for the European Long Term Investment Fund (ELTIF), without replacement. This reflects the fact that no ELTIFs have been established in the UK, removing unnecessary retained EU law, and that the newly established Long Term Asset Fund (LTAF) regime provides a fund structure better suited to the needs of the UK market. Firms have already begun to seek FCA authorisation for funds taking advantage of this new structure.Publishing the Short Selling Regulation Review, a Call for Evidence on the UK’s regime for regulating short selling, with the aim of putting in place a regulatory regime tailored to the UK, which supports market integrity and bolsters the competitiveness of UK financial markets.Publishing PRIIPs and UK Retail Disclosure, a consultation on a proposed alternative framework for retail disclosure in the UK. Following the repeal of the Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation, the new framework for retail disclosure in the UK will work more effectively with the UK’s dynamic capital markets and foster more informed retail investor participation.Publishing the Information Requirements in the Payment Account Regulations Consultation which examines proposals to remove unnecessary customer information requirements related to bank accounts imposed by the EU in the Payment Accounts Regulations. This would reduce unnecessary regulations on banks, freeing them up to better meet the needs of UK customers.Updating banking regulation and the ring-fencing regime The government will bring forward secondary legislation in 2023 to improve the functionality of the ring-fencing regime. These reforms, in response to the independent review on Ring-fencing and Proprietary Trading, will benefit customers, the financial services industry, and the economy, while maintaining appropriate financial stability safeguards. The government will also issue a public Call for Evidence in the first quarter of 2023 to review the practicalities of aligning the ring-fencing and resolution regimes.The PRA intends to consult on removing rules for the capital deduction of certain non-performing exposures (NPEs) held by banks. This would allow the PRA to apply a judgement-led approach to address the adequacy of firms’ provisioning for NPEs, help to simplify the UK rulebook and avoid the unnecessary gold plating of prudential standards. Such an approach would be possible only because of our regulatory freedoms outside the EU.The PRA intends to consult on removing rules for the capital deduction of certain non-performing exposures (NPEs) held by banks. This would allow the PRA to apply a judgement-led approach to address the adequacy of firms’ provisioning for NPEs, help to simplify the UK rulebook, and avoid the unnecessary gold plating of prudential standards. Such an approach would only be possible because of our regulatory freedoms outside the EU. The government will also legislate, when parliamentary time allows, to amend the Building Societies Act 1986 to give building societies in the UK greater flexibility to raise wholesale funds, enabling them to grow and compete on a more level playing field with retail banks, while retaining their mutual model. As part of this, the government will also modernise relevant corporate governance requirements in line with the Companies Act 2006.Ensuring a regulatory focus on growth and competitivenessThe government is legislating through the FSM Bill to introduce new secondary objectives for the FCA and PRA to provide for a greater focus on growth and international competitiveness while maintaining their existing primary objectives. To further support this aim, I will today lay before Parliament new remit letters for the FCA and the PRA which will set clear, targeted recommendations for how the regulators should have regard to the government’s economic policy.Separately, the government and regulators will separately commence a review of the Senior Managers & Certification Regime in Q1 2023. The government will launch a Call for Evidence to look at the legislative framework of the regime, and the FCA and PRA will review the regulatory framework. The government's Call for Evidence will be an information gathering exercise to garner views on the regime's effectiveness, scope and proportionality, and to seek views on potential improvements and reforms.Wholesale markets reformsThe government is committed to strengthening the UK’s position as a world-leading wholesale capital markets centre, and is taking forward reforms to the Markets in Financial Instruments Directive (MiFID) framework through the Wholesale Markets Review. Measures in the FSM Bill deliver key elements of this. To further support this agenda, the government:Will today lay before Parliament The Markets in Financial Instruments (Investor Reporting) (Amendment) Regulations 2022, which will remove burdensome EU requirements related to reporting rules. This also builds on the reforms brought forward through The Markets in Financial Instruments (Capital Markets) (Amendment) Regulations 2021 laid in June 2021.Will bring forward secondary legislation in Q1 2023 to remove burdens for firms trading commodities derivatives as an ancillary activity, for example, when manufacturers seek to fix the future price of their purchases of specific raw materials.Is committing, alongside the FCA, to having a regulatory regime in place by 2024 to support a consolidated tape for market data. A consolidated tape will bring together market data from multiple platforms into one continuous feed. This will improve market efficiency, lower costs for firms and investors, and make UK markets more attractive and competitive.Will launch the Investment Research Review: an independent review of investment research and its contribution to UK capital markets competitiveness. The review is part of the government’s wider commitment to enhance the UK’s ability to attract companies to list and grow.Will establish a new industry-led Accelerated Settlement Taskforce to explore the potential of faster settlement of financial trades in the UK. Reducing settlement times from the current industry standard of two days could reduce counterparty risk and increase operational efficiency. The taskforce will bring together industry stakeholders to recommend an approach that works for the UK.Unlocking investment to drive growth across the whole economyThe UK’s financial services sector is an engine for growth across all four nations of the UK. The government is therefore bringing forward measures that will unleash the sector to drive investment and growth.The government set out its plans to reform Solvency II at Autumn Statement, unlocking more than £100bn pounds for UK insurers to invest in long-term productive assets. HM Treasury is working with BEIS to deliver the recommendations made to government as part of the Secondary Capital Raising Review, and more broadly on reforms to corporate governance, to further enhance the attractiveness of UK public markets.Going further, the government announces today that it:Will, in early 2023, consult on new guidance to the Local Government Pension Scheme (LGPS) in England and Wales on asset pooling. The government will also consult on requiring LGPS funds to ensure they are considering investment opportunities in illiquid assets such as venture and growth capital, as part of a diversified investment strategy.Is committed to accelerating the pace of consolidation so that no pension savers are left in poorly governed and underperforming schemes. In the new year DWP will lead the way by consulting on a new Value for Money framework, alongside the FCA and the Pensions Regulator, which will set required metrics and standards in key areas such as investment performance, cost and charges and quality of service that all schemes must meet.Will amend the tax rules for Real Estate Investment Trusts (REITs). With effect from April 2023, new rules will remove the requirement for a REIT to own at least three properties, where they hold a single commercial property worth at least £20 million; and amend the rule that applies to properties disposed of within three years of significant development activity, to ensure that this rule operates in line with its original intention.Has today published a technical consultation, VAT treatment of fund management: consultation, which sets out proposals for legislative reform intended to codify existing policy to give legal clarity and certainty, not to make policy changes. The consultation seeks input on whether the proposed changes achieve this objective.A World Leader in Sustainable FinanceThe government is ensuring that the financial system plays a major role in the delivery of the UK’s net-zero target, and is acting to secure the UK as the best place in the world for responsible and sustainable investment. The UK is the world’s premier financial centre for sustainable finance. The government is acting to ensure the UK retains global leadership in this rapidly growing sector. To deliver on its commitment align the financial services sector with Net Zero and to support the sector to unlock the necessary private financing, the government:Will publish an updated Green Finance Strategy early 2023.Will consult in Q1 2023 on bringing Environmental, Social, and Governance (ESG) ratings providers into the regulatory perimeter. HM Treasury will also join the industry-led ESG Data and Ratings Code of Conduct Working Group, recently convened by the FCA, as an observer. These services are increasingly a component of investment decisions, and the government wants to ensure improved transparency and good market conduct.A sector at the forefront of technology and innovationOur regulatory framework for financial services must support innovation and leadership in emerging areas of finance. To ensure the sector is prepared to embrace and facilitate the adoption of cutting-edge technologies, the government is:Setting up a Financial Market Infrastructure Sandbox in 2023, and is legislating to implement this in the FSM Bill. This will enable firms to test and adopt new technology and innovations, such as distributed ledger technology, in providing the infrastructure services that underpin markets.Working with the regulators and market participants to bring forward a new class of wholesale market venue, which would operate on an intermittent trading basis. This highly innovative approach would be a global first and would act as a bridge between public and private markets, boosting the UK as a destination for all companies to get the investment they need to create jobs and grow.Legislating in the FSM Bill to establish a safe regulatory environment for stablecoins – which may be used for payments – and ensure the government has the necessary powers to bring a broader range of investment-related cryptoasset activities into UK regulation.Publishing its formal response to the consultation on expanding the Investment Manager Exemption to include cryptoassets, which will facilitate their inclusion in the portfolios of overseas funds managed in the UK. The government intends for this change to be made through HMRC regulations this yearBringing forward a consultation in the coming weeks to explore the case for a central bank digital currency – a sovereign digital pound – and consult on a potential design. The Bank of England will also release a Technology Working Paper setting out cutting-edge technology considerations informing the potential build of a digital pound.Delivering for consumers and businessesThe government is committed to a financial services sector that supports the real economy and will continue to work with the regulators and industry to ensure that the sector is delivering for people and businesses across the UK. The government:Has published a consultation, Reforming the Consumer Credit Act 1974. By modernising the regulation of consumer lending, reform will update consumer protections and ensure they work well in a modern and increasingly digital economy. It will also increase accessibility of credit products by allowing firms to better serve consumers through more innovative credit products.Has consulted on reforms to remove well-designed performance fees from the pensions regulatory charge cap and will lay regulations early in the New Year. This will provide clarity for industry and ensure pension savers can benefit from investing in UK innovation.Is committed to working with the FCA to examine the boundary between regulated financial advice and financial guidance, with the objective of improving access to helpful support, information and advice, while maintaining strong protections for consumers.I am confident that the measures announced today, in tandem with the work taken forward through the FSM Bill, will deliver for this key growth sector, and the people and businesses that rely upon it.Documents relating to all announcements can be found on GOV.UK www.gov.uk/government/collections/financial-services-the-edinburgh-reforms[1] State of the Sector Report (July 2022) available at: State of the sector: Annual review of UK financial services 2022 - GOV.UK (www.gov.uk)[2] House of Commons Library ‘Financial services: contribution to the UK economy’: https://commonslibrary.parliament.uk/research-briefings/sn06193/

Treasury Update

Baroness Penn: The development of a UK Green Taxonomy is a complex, technical exercise which is linked to multiple sectors of the economy and various legislative and regulatory frameworks. This complexity is also becoming apparent in the European Union (EU), where challenges have arisen during the implementation of the EU’s taxonomy. The Government is clear that the value of a taxonomy rests on its credibility as a practical and useful tool for investors, companies, consumers and regulators in supporting access to sustainable finance. These are long term matters and it is important to proceed carefully. Having received advice from the Green Technical Advisory Group, and following stakeholder engagement, the Government believes that there is benefit in reviewing its approach to taxonomy development to maximise the effectiveness of our sustainable finance agenda. Therefore, the Government will not make secondary legislation under the Taxonomy Regulations this year. The Financial Services and Markets Bill is currently before Parliament. Subject to parliamentary approval, the Bill will repeal retained EU law relating to financial services – including the Taxonomy regulations. Using the powers in the Bill, HM Treasury intends to first commence the repeal of the statutory requirement to make technical screening criteria regulations by 1 January 2023, so that the obligation no longer applies. Then it will consider how to use the powers in the Bill to restate and modify retained EU law, and decide whether to change the UK’s approach. This is consistent with the Government’s general approach to retained EU law for financial services. The Government will provide a further update as part of its publication of the Green Finance Strategy in early 2023.